The Regulation of Algorithms

In Law, companies have the rights and obligations of a person. Algorithms are rapidly emerging as artificial persons. Intelligent algorithms will require formal training, testing, verification, certification, regulation, insurance, and status in law.

Governments and research councils are publishing principles for algorithmic transparency and accountability. Governments and regulators are modifying national laws to encourage innovation, with lawyers and insurers scrambling to absorb the implications.

We consider the growth of Algorithmic trading and current regulation including ‘Robo Advisers’. And testing by the assessment of the risks of and views on quality by:

Algorithm Formal Verification – proving or disproving the correctness of algorithms underlying a system – with respect to a certain formal specification or property.

– Algorithm Cross-Validation – techniques to assess how the results of an algorithm perform in practice.

In the workplace, algorithms are rapidly becoming a judge & jury ‘star chamber’ where firms such as rely on Algorithms to make business decisions. Gaps between the design and operation of algorithms, their ethical implications, and the lack of redress may have severe consequences. We consider whether computers could or should replace Judges and whether a new regulator should be established, backed by a code of sanctions.

We consider the Companies Act S156 A and the concept of an algorithm as ‘a legal person’, an issue which will likely provoke an intense debate between those who believe in regulation and those who believe that ‘code is law’.